The rules of safety are written in blood. The statement sounds familiar to every soldier. While we do not deal with the risks to human life, losing Bitcoins is expensive by making a trading mistake is certainly not a fun situation.
So how can we avoid mistakes in our trade? What about the green ones? First, it is important to note that for the right trade to require your hundred percent attention and focus. Second, trade is not for everyone. The following tips are easy to internalize as they are “written in blood” (my own blood). However, it is still difficult to use in real-time. After all, we’re not rational humans.
Have a reason before entering each trade:
Start trading only when you know why you started and have a clear strategy for it later.
Not all traders make a profit from trading, as this is a zero-sum game (for everyone who benefits others loses the other side). The Altcoins market is driven by big whales (yes, the same ones who are responsible for placing hundreds of large blocks of Bitcoin in booklets).
The pope is just waiting patiently for an innocent little fish like we made a mistake. Even if you aspire to trade daily, it’s sometimes best not to earn and to do nothing, rather than jumping into the rushing waters and exposing your coins to losses. From my experience, there are days where you only keep your profits without trading at all.
Target and stop when starting a trade:
For each trade, we must set a clear target level for profitability and more importantly, a stop-loss strategy. Stop-loss sets the level at which the trade will close.
Here again, it is important to consider several factors when choosing the right stop loss level. Most traders fail when they fall in love with trade or coins themselves.
They might say, “Here it will turn around, and I will come out of this trade with minimal loss, I’m sure.” They let their ego control them and unlike traditional stock exchanges where extreme daily movements account for 2-3% of their value, Crypto’s trading is far riskier: in my life as a trader I’ve seen the coin toss by 80% in just a few hours. ! And no one wants to be the one to hold it.
Meet FOMO (fear of losing):
In fact, it’s not fun to see such a situation from the outside – when certain coins are treated like crazy with huge double digits in minutes.
That green candle dares to scream at you “you’re the only one who doesn’t hold me”. During this time, you will see people paralyzed flooding the Crypto forums and Troll exchange boxes to discuss this pump. But what do we do now? Very easy, Keep moving forward.
True, there may be an increase in the price ahead of us and it may continue to rise, but keep in mind that whales (as mentioned above) are only waiting for small buyers on the way to selling them the coins they bought at a lower price. Prices are high and it is clear that the current coin holder only consists of the small fish. Needless to say, the next step is usually a bright red candle sold through the entire booklet.
Small pigs eat large, large pigs eat. This statement tells the story of market profitability from our perspective. To be a profitable trader, you will not be looking for a peak. You are looking for a small profit that will accumulate into a big one.
Manage risks wisely across your portfolio. For example, you should not invest more than a small percentage of your portfolio in a non-liquid (very high risk) market. For them trading we will give greater tolerance – the stage is stopped and the target will be chosen far from the point of purchase.
The underlying fundamentals create uncertain market conditions:
Most Altcoins are trading at the Bitcoin value.
Bitcoin is a volatile asset (relative to FIAT) and this fact should be taken into account, especially in the days when Bitcoin’s value moves sharply. Bitcoin and Altcoins have inverse relationships in their value, i. e. when Bitcoin values ?? Rise then Altcoins lose their Bitcoin value and vice versa. When Bitcoin is uncertain, our conditions for trading are somewhat clouded. During the fog, we can’t see any further, so it’s best to have a close target for our trading or not to trade at all.
Tips for trading Altcoins: Most Altcoins lose their value over time. They just discard their value slowly (sometimes quickly).
Keep this in mind when holding Alts for a medium and long term, and of course, choosing them carefully. What types of Alts are recommended for the long term? Remember, this is only when there is a reason to trade. Projects/coins with higher daily trading volume and a wider community behind them, with ongoing development, are here to stay with us:
Monero XMR, Factom FCT, DASH, all major coins and traded the most every day. You should follow the coin chart and identify low and stable periods. Such a period is likely to be a period of consolidation by the pope, and when the time comes, accompanied by a good press release of the project, the pump will start and they will sell at a profit.
Remarks on public ICO (public sale):
Many new projects choose to make large sales where they offer investors an initial opportunity to buy a portion of the project (token or coin) in what is meant to be a good price for the token.
The motivation of the investors is that the token will be traded from day to day on the exchange and will provide a great advantage to ICO participants. In recent years, there have been many successful ICOs, both projects themselves and especially in measuring revenue for investors. Coins are double, or triple, their value and more in relation to their value in public sales. The early Augur public sale (we report it here) gives investors a 1, 000% phenomenon for their investment. Okay, but what’s going on here? Not all projects benefit their investors. Many ICOs have proven to be complete scams, not only are they not traded at all but some projects are lost with money and we haven’t heard from them until today.
So how do you know if you should invest in an ICO? This is not about science, it’s important to pay attention to the seriousness of the project and its team. Find the project website (does it look like a kid built it during computer school?), Who’s the team behind the project – Are they hiding behind a pseudonym or proud to be on their website? Pay attention to the Bitcointalk thread (does it exist at all) and how team members respond to technical questions. Is there a large community behind this project? Expect to see Slack gather his community.
Note the amount raised: A project that has been raised too small may not grow over time, a project that has raised a lot – there will not be enough investors left to buy coins on the exchange. And most importantly is risk management. Never put all your eggs in one basket and invest too much of your portfolio in one ICO.
Final tips – practical steps to take immediately:
Fees, Fees, Fees: Miscellaneous Trade Actions = More Fees. It is always advisable to publish the order (the manufacturer) and not buy it from the order book (the recipient). In Poloniex exchange, the difference is 0. 1% in favor of the maker. That’s a bit.
Depressed traders: Don’t start trading unless you have the optimal conditions for making a decision to start trading and knowing when and how to exit it. Pressure almost always causes loss of trade.